Asian Stock Market News: Asian markets turned negative in afternoon trade on Tuesday, with Hong Kong’s Hang Seng Index down more than 2.5% after the market reopened from a long holiday weekend as yuan extended decline.

China Mobile Ltd (HK:0941) made headlines after reports on Monday suggested that the Trump administration moved against letting the government-owned telecommunications company enter the U.S market.

The National Telecommunications and Information Administration, a branch of the Commerce Department, said in a filing that the move by the phone carrier would pose national security risks, and that the Federal Communications Commission should deny China Mobile’s application to offer international voice traffic between the U.S. and foreign countries.

“The deepening integration of the global telecommunications market has created risks and vulnerabilities in a sector replete with a broad range of malicious activities,” the NTIA said in its filing.

The Shanghai Composite opened higher but erased its early advance and slid 0.87% by 1:30AM ET (05:40 GMT), while the Shenzhen Component also down 1.47%.

The yuan was in focus as it dropped below 6.7 versus the dollar for the first time since Aug. 9, 2017

“China’s weak market yesterday and the weakness in the yuan are having a very negative sentiment on the Hong Kong market,” said Banny Lam, head of research at CEB International Investment Corp.

Investors are likely to continue monitoring developments on the trade front as the U.S. is set to impose a 25% tariff on $34 billion worth of Chinese goods before the July 6 deadline. In response, China has announced that it would retaliate with duties on the same value of U.S. products.

Down under, Australia’s S&P/ASX 200 gained 0.6%. The Reserve Bank of Australia left its key interest rate unchanged at 1.5% on Tuesday as expected.